Intelligence and Good Judgment

It is hard to overstate the importance of the concept of intelligence for applied psychology; intelligence testing may be the most important single contribution psychology has made to larger society. Advocates of intelligence testing provide data showing that IQ predicts virtually every significant life outcome from income and occupational status to life expectancy. Nonetheless, the concept continues to make some of us uncomfortable for three reasons. First, the concept of intelligence is still poorly defined; the default definition is, “intelligence is what intelligence tests test”. Second, all of us know people who have received very high scores on standard IQ measures who nonetheless have trouble functioning in the world. And third, in standardized cognitive assessment, problems are fully defined; in the real world, problems are almost always poorly defined. The term “intelligent” is a judgment that we use to evaluate performance; for example, in athletics, certain people are known as smart players and others are not. A moment’s reflection suggests that the term “intelligent” mostly applies to decisions—smart decisions precede smart actions and vice versa. Decision making is particularly important in business, politics, and warfare where money and lives are on the line and bad decisions affect the welfare of many people. Decision making is also typically difficult in business, politics, and warfare because there is almost never enough time or information to make a carefully reasoned decision. The term “good judgment” applies to the ability to make sound and defensible decisions with limited time and information. The book, “Why Smart Executives Fail” by Sydney Finkelstein (2003), contains a large number of richly detailed case studies of failed business enterprises and is a superb data base for thinking about good (and bad) judgment. At the surface level, businesses fail for a variety of reasons—technology shifts, new competitors, ill-advised acquisitions—but at a deeper level, bad judgment appears to be the cause of the problem in every case. And in every case, the bad judgment was exercised in two stages. In the first stage, the company’s CEO chose the wrong means to accomplish a desired end. In the second stage, the CEO stayed with his/her choice despite information that the choice was a bad one. For example, in the 1980s, General Motors (GM), the world’s largest automobile manufacturer, faced two looming problems. The first was competition from low cost, high quality Japanese cars. The second was labor unrest at home. The CEO of GM, Roger Smith, decided he could solve both problems by replacing his workers with robots. He invested more than $45 billion in robots—enough to buy both Toyota and Nissan—but the investment failed because the key to the Japanese success was the manner in which they integrated their technology with their workforce, rather than their robotic technology per se. As one industry insider noted, by using technology without the prepared workforce, all Roger Smith did was automate confusion. However, he persisted in his decision, and GM’s productivity continued to decline relative to Toyota. Again, bad judgment is a two stage process. In the first stage, a person chooses the wrong means to get to the desired end. In the second stage, a person persists with the choice despite evidence that it was wrong. For persons familiar with the structure of the Hogan Business Reasoning Inventory (HBRI), choosing the wrong means to get to a desired end is a failure in Strategic Reasoning, while persisting in a bad choice after data are available is a failure of Tactical Reasoning.

Abstracting Leadership

  At Hogan, we believe that leadership is the most important problem in management science. When good leaders are in place, organizations and their members prosper, when bad leaders are in place, organizations and their members suffer. At the same time, the academic study of leadership has largely failed to deliver any real-world generalizations about leadership or recommendations regarding how to find it or develop it. The academic study of leadership has failed for three reasons: (1) Leadership is poorly defined; (2) Mainstream literature ignores personality; (3) Nobody pays attention to return on investment (ROI). Let’s consider these points in turn. The Definition of Leadership. Leadership is defined in academic literature primarily in terms of the people who are in charge. The assumption is, if a person is a manager, president or CEO, he/she is by definition a leader. This is a big mistake for at least two reasons. First, ask yourself how a person rises in a large, hierarchical, bureaucratic, male-dominated organization. The answer is, by playing politics, not by exercising leadership. It was said of Dwight Eisenhower, “He didn’t become a politician because he was a general, he became a general because he was a politician.” People typically rise in large organizations by pleasing their superiors with their loyalty and technical knowledge, not by displaying leadership skills. Second, the base rate of failure for managers in America is about 65%; thus, 65% of the people in “leadership” positions today will fail in one way or another. To the degree that leadership is defined in terms of who is in charge, the research won’t lead to replicable conclusions—because success in any organization is idiosyncratic. Who wins in such pursuits will largely depend on the circumstances—the nature of the competition, the team of judges, the climate of the times, etc. Situations versus Personality. Most major organizations in the United States, public or private, military or civilian, assume that almost anyone can be (or can learn to be) a leader, and will perform appropriately when put in charge of other people. People are promoted based on time in service and technical talent, with no consideration given to the possibility that some people have more talent for leadership than others. Sometimes this assumption is based on intellectual laziness, but among psychologists the assumption reflects the lingering effects of behaviorism and situationism—the view that what people do depends on where they are not who they are. However, the average person understands that some people perform better in leadership positions than others, and the reason has to do with the kinds of persons they are—i.e., their personalities. ROI-based Research. Most managers are evaluated by their bosses—the people who hired or promoted them and who have a vested interest in their doing well. But many bad managers are skilled at pleasing their bosses, which drives the bosses’ evaluations. It seems obvious to us that managers ought to be evaluated in terms of the performance of the group that they manage. Although this is rarely done, it is easy to do, and when done correctly, it turns out that effective managers have a distinctive personality style which varies systematically with the industry and their level in their organization. We discuss this in more detail below. The remainder of this discussion is organized in six parts. We define personality, we define leadership, then we show how personality impacts leadership, and how leadership (properly defined) impacts business unit performance. We then analyze the crucial role of followers for business unit performance, and how to enhance their engagement. 1. Defining Personality. We believe that personality is related to leadership—who you are determines how you lead. But we need to define personality, and it should be defined from two perspectives: how a person thinks about him/herself and how others think about that person. We refer to this as the actor’s and the observer’s perspectives on personality, and it is important to keep them distinct. The actor’s perspective is a person’s identity, the story that he/she tells others about him/herself—it is an idealized self view. Although identity has been the major focus of personality research from Freud to the present, it has been a non-productive focus. After 150 years of research, there are no reliable generalizations to report, there is no measurement base, there is no taxonomy to organize the subject matter. How people think about themselves is almost impossible to study in a rigorous way; hence that study has led to no conclusions. On the other hand, personality from the observer’s perspective—a person’s reputation—is easy to study and leads to some very useful generalizations. First, unlike identity, reputation is quite stable over time. Second, reputation has a well recognized taxonomy—it is called the Five-Factor Model (sometimes “the Big Five”). Everyone’s reputation can be described in terms of five dimensions: (1) Anxious vs. Confident; (2) Shy vs. Assertive; (3) Tough vs. Charming; (4) Careless vs. Conscientous; and (5) Narrow- minded vs. Open-minded. And third, these five dimensions predict a wide range of performance outcomes, including leadership, better than measures of cognitive ability. There is almost complete consensus in the research community that personality should be defined in terms of these five (large) dimensions, with finer distinctions within the five being possible and useful. 2. Defining Leadership. Conventional leadership literature focuses on charismatic or transformational leadership, and this focus has led to few reliable generalizations. We prefer a functional definition—because leadership has a job to do. The leader’s job is to persuade otherwise selfish people to work together for a period of time to accomplish a common objective. Thus we define leadership in terms of the ability to build and maintain a high performing team, and we think leadership should be evaluated in terms of the performance of the team, relative to the competition. Defining leadership this way has two useful consequences. On the one hand, the research literature becomes interpretable. On the other hand, this definition brings the issue of ROI into focus. 3. Personality and Leadership. We have now defined personality (as reputation) and leadership (as the ability to build a team). The next question concerns the links between personality and leadership. (We should note that, as recently as 1990, academic researchers maintained that this question was nonsense—because leadership was deemed to be a function of “the situation”—e.g., situational leadership.) In 2002, Tim Judge, a researcher at the University of Florida, published a landmark study. Using 20,000 managers from 5,000 organizations, representing every industry sector, he showed that personality, defined in terms of the Five-Factor Model, predicts rated leadership performance very substantially, and much better than measures of cognitive ability. For those of us who believe in data, this seals the case—personality and leadership are rather tightly connected. Good managers are Confident, Assertive, Conscientious, Open-minded, and not necessarily Charming. 4. Leadership and Business Unit Performance. In 2002, James Harter, Frank Schmidt, and Ted Hayes, three researchers funded by Gallup, published another landmark study that shows three things. First, the personality of the manager impacts the morale of the work group. Second, when morale is up, good business results follow; when morale is down, bad results follow. And third, the link between the manager’s personality and business unit performance is mediated by staff morale. This means that leadership is indirectly, and staff morale is directly, connected to ROI. 5. Understanding the Role of the Follower. Leadership involves getting results through other people—it is not about the charisma of individual leaders, it is about persuading followers to adopt the leader’s agenda. Work is a (sometimes painful) extension of everyday life. Personality psychology tells us that people have three overriding needs that govern their lives: (1) People need acceptance and respect, and they dread criticism and rejection; (2) People need status and the control of resources, and dread the loss of status and resources; (3) And people need structure and predictability in their lives, and find the lack of structure to be stressful. These needs are operating at work, during interaction with peers and management. Thus, good managers provide their staff with respect, allow them to control their own work, and make sense out of business activities. Bad managers do the opposite, and are unable to build a team. 6. The Lessons of Engagement. Engagement is the central factor underlying employee performance in modern business, and it is almost entirely a function of leadership. Senior leadership needs to establish a culture that recognizes, values, and facilitates engagement. First line supervisors and managers need to treat their employees in ways that minimally don’t actively alienate them, and ideally in ways that encourage engagement. But there is no cookie cutter approach to this. Rather, encouraging engagement puts specific demands on individual leaders, who must establish and maintain working relationships with their employees, one employee at a time. Some people are better able to do this than others, such people can be identified by their personality signature, and to the degree that organizations value ROI, they will pay attention to this research-based conclusion. -- Dr. Robert Hogan  

Organizational Dynamics and Evolutionary Theory

A small number of psychologists, economists, and management theorists have been enthusiastically trying to determine how modern evolutionary theory can be used to understand the dynamics of organizations. Traditional evolutionary theory—the survival of the fittest model—supports selfishness, predatory capitalism, and the importance of individual self-interest. However, some economists have begun to test people using variants of competitive games (of which the Prisoner’s Dilemma is the best known). This research has led to two important findings. First, the strategies that people use in these competitive bargaining games fall into three robust and replicable categories. About 15% of every population consists of altruists—people whose first instinct is to cooperate, to extend benefits to others, to work for the common good. About 20% of every population consists of free riders—people whose first instinct is to take advantage of other people, act selfishly, and contribute nothing to the common good. And finally, about 65% of every population consists of people who tailor their actions to those of the other person—they will cooperate when others cooperate, and compete when others compete. Second, these data show quite clearly that the selfishness model proposed by traditional evolutionary theory is wrong, it does not characterize the behavior of most people. The new thinking argues that traditional evolutionary theory needs to be augmented with insights from: (1) multi-level selection; and (2) gene-culture co-evolution theory. Putting the three lines of analysis together tells us that people evolved as group living animals, and that the groups competed with one another for scarce resources. This, in turn, leads to several interesting insights regarding organizational dynamics. The first insight is that the percentages of altruists, free riders/cheaters, and switch hitters described above are about what we should expect to find in any normal population. The second insight is that people are best understood in terms of their relations to the other members of their groups. Thus, although traditional psychoanalysis and psychology has focused on isolated individuals and how they deal with their private demons, this has been a big mistake because what is inside, in people’s psyches, started outside in their relations with others. Third, human evolutionary history has designed people so that they are pre-programmed in two main ways. On the one hand, they are from birth ready to compete with the other members of their group for status and resources. On the other hand, they will cooperate with the other members of their group when faced with external competition. Thus people live in a state of internal tension and must learn to balance their desires to compete with others against their needs for the support of others. Fourth, every human group is faced with two unavoidable problems. On the one hand, there is a strong tendency for “leaders” to exploit their groups for their own selfish purposes, and subordinate group members must maintain a watchful eye to avoid being exploited. On the other hand, there is a strong tendency for the members of any one group to begin fighting with their neighboring groups. Thus, organizations that are composed of several groups will compete with one another based on the degree to which they can persuade their constituent groups to stop the internal fighting. Think, for example, of the two major U.S. political parties.Finally, then, good leadership is a resource for the group rather than a source of privilege for the leader(s). Good leadership is able to: (1) persuade the subordinate group members that the leadership won’t exploit them; and (2) persuade the subordinate group members to stop fighting with one another and concentrate on the competition. -- Robert Hogan

The Truth about Gossip and Reputation

From the beginning of personality psychology as an academic discipline in the 1930s, the conventional wisdom has maintained that reputation is an epiphenomenon of no real psychological significance or interest. Instead, according to Gordon Allport, personality psychology concerns the factors that make each person distinctive and unique. This was a mistake for two reasons: (1) it is impossible to generalize from uniqueness; and (2) reputation is easy to study and is a powerful predictor of behavior. Another suspect topic is gossip. Conventional wisdom has maintained that gossip is little more than character assassination, and is something that right minded people will avoid. In the 1970s researchers began studying normal conversations and discovered that when real people (as opposed to academic psychologists) talk, they mostly (about 70% of the time) engage in gossip—they talk about other people. That which reputation and gossip have in common is language. Robin Dunbar, a British anthropologist, is credited with the view that language evolved as a mechanism to organize and smooth social interaction. Dunbar thinks conversation among humans takes the place of social grooming in chimpanzees (our nearest relative); he thinks conversation serves to create social bonds. I have argued for a long time that much conversation is actually about gossip and gossip is mostly about coming to a common agreement about another person’s reputation—hence the link between gossip and reputation. Knowing another person’s reputation is quite helpful in deciding how to deal with that person in future interactions. Gossip tells us who we can trust; conversely, the prospects of acquiring a bad reputation serves to control people’s otherwise selfish tendencies—gossip functions as a mechanism of social control. Ralf Summerfield and colleagues at the Max Planck Institute for Evolutionary Biology published a study in the Proceedings of the National Academy of Sciences that is an interesting contribution to this line of thinking. They used the standard game theoretical paradigm in which two people interact, and each has the option of competing or cooperating. If both cooperate, both win; if one competes while the other cooperates, the selfish person wins even bigger. In this study, participants were provided information regarding the other person’s reputation as either selfish or cooperative. As expected, they found that if a person expected to interact with someone with a reputation for selfishness, he/she would behave selfishly, but if a person expected to interact with someone with a reputation for cooperation, he/she would tend to cooperate. The real news in the study, however, concerned a particular wrinkle. In some cases they would provide the participants with both data regarding other person’s performance and a description that person’s reputation. Participants invariably believed the gossip rather than the data. As Sommerfeld noted: “It could be that we are just more adapted to listen to other information than to observe people, because most of the time we’re not able to observe how other people behave. Thus we might believe we have missed something.” There are two points about this that are worth remembering. First, people believe gossip over actual data regarding a person’s performance. And second, smart people will try to keep their reputations in good shape. -- Dr. Robert Hogan

Revisiting LMX Theory

In 1982 I undertook a self-taught crash course in I/O psychology, with a special emphasis on leadership. At that time, I concluded that LMX theory was the only model of leadership that made any sense; the alternatives seemed hopelessly academic. I have recently had the opportunity to meet George Graen, the author of LMX theory and to confirm my initial reactions. George is smart, productive, perceptive, and an artist— which means that he is constantly fiddling with his ideas. At its core, however, LMX theory is, in my judgment, exactly right. I would like to summarize the highlights of the theory, as I understand it.First, LMX stands for “leadership motivated excellence”, although Graen has changed the meaning of the term three times. Nonetheless, leadership motivated excellence is the “real” definition of the term.Second, and in contrast with most discussions of leadership, Graen understands that it is not about the person in the role, leadership is about the performance of the team or business unit of which the “leader” is in charge. Graen evaluates leadership in terms of the team’s performance, and this is rarely done in the academic literature.Third, Graen makes a crucial distinction between leadership models that concern between group performance, and models that concern within group performance. Between group models evaluate managers using ratings by a few members of the manager’s team (e.g., the typical 360 subordinate evaluation). Managers of successful teams are compared with managers of less successful teams, based on these averaged ratings, and those data are used to identify the characteristics of successful managers. This methodology has led to inconsistent results over time. In contrast, LMX theory uses ratings from everyone on the team to evaluate a manager, and the evaluations concern the relationship between each team member and the manager. These dyadic relationships tend to be very stable over time, and lead to convergent research findings.Fourth, consistent with best practices of managers of real teams, Graen says leadership is not about how a manager treats his/her team in general or on average. Leadership is about building relationships between each member of the team, one person at a time. This is the key insight of Red Auerbach, the legendary coach of the Boston Celtics of the National Basketball Association—you motivate a team one player at a time. Rob Kaiser points out that the principle source of variance in 360 ratings is the ratings provided by single individuals—exactly as LMX theory would predict.LMX theory is rooted in social exchange theory—the leader and the member each get something from the relationship, otherwise defections will occur. Thus, followers can influence leaders as much as the reverse. Each dyadic relationship (between the leader and an individual member of the team) is unique and determined by the personalities of the two people involved. The quality of the dyadic relationship is the key factor affecting the member’s motivation. Inevitably, the members who are in a leader’s “in-group” contribute more to the team than those who are not.Fifth, Graen has a standardized rating form that can be used to evaluate the quality of the LMX dyads that make up any team. Higher scores on this rating form are associated with more effective teams that communicate, cooperate, and coordinate better, and have lower turnover intentions.Sixth, Graen has standardized (and proprietary) protocols for training managers in the kind of relationship building that LMX theory spotlights. Furthermore, he says that he has data showing that managers who are trained on this LMX model do better, in the sense that their teams perform better after they have undergone training.Seventh, the standard criticism of LMX theory in the I/O literature is that LMX is all about likability, that subordinates give higher ratings to supervisors that they like, so that LMX theory only concerns “halo or nuisance variance”. But Graen is quite clear that the LMX relationship depends on three elements: (1) the subordinate trusts his/her manager; (2) the subordinate respects the competence of his/her manager; and (3) the subordinate believes his/her manager is concerned about the welfare and performance of the team. These elements might result in likeability, but likeability is not necessarily entailed by these elements. As Graen notes, many aspects of a successful manager’s behavior make that person likeable, but the three criteria listed above are what predict team performance.Finally, as far as I can tell, every aspect of LMX theory is supported by data, and every aspect of LMX theory is consistent with the way I think about leadership, starting with speculations about the role of leadership in the evolution of our species, and ending with what is wrong with modern corporate leadership.

Character and Personality

About 10 years ago, academic researchers rediscovered personality and its relationship to job performance. More recently, after the events symbolized by the collapse of Enron and MCI, the business community seems to have rediscovered the importance of character as a determinant of job performance—especially in the senior ranks. These represent different insights in the popular literature, because personality and character are usually considered separately. Nonetheless, the concepts of “character” and “personality” are closely linked; for example, Aristotle defined character in dispositional terms that are synonymous with the contemporary concept of personality. Moreover, the first academic journal devoted to personality research, established in 1932, was called Character and Personality. Gordon Allport, one of the founders of personality psychology in the U.S., remarked in his influential 1937 book that “character is personality evaluated, personality is character devaluated.”Personality psychology has always been outside the mainstream of academic psychology because it explicitly assumes that values are an inherent part of social life, and that character is part of personality. Lee J. Cronbach, grand arbiter of psychological fashion for 50 years, denounced personality and personality assessment in his 1960 textbook because some of the concepts (i.e., integrity) are “value laden.” Like all good behaviorists, Cronbach wanted psychology to be like the physical sciences—values free. Poor old Cronbach never understood that the physical sciences, like the human sciences, are shot through with value considerations. Values are about preferences, they concern rules that people use to make choices in ambiguous circumstances. Tycho Brahe, Copernicus’ teacher, was a religious nut who thought the sun was God, and therefore belonged at the center of the universe. His arbitrary value system set Copernicus on his quest to demonstrate that our universe revolves around the sun.Character is a term that summarizes a set of values. Values are indispensable for navigating social life. The only question concerns how to justify one’s values. Most people justify their values by appealing to authority—legal or religious. The framers of the U.S. Constitution justified their value choices in terms of the welfare of society, a pragmatic decision that informs our thinking as well.The most fundamental requirement for a functioning society is order—a system in which people comply with the established rules and customs of the group. However, in any functioning group, cheaters inevitably emerge and take advantage of those who are more compliant—this is an important principle in evolutionary theory: cheaters inevitably emerge. Cheaters threaten the integrity of their groups with varying degrees of severity. People of good character, people with integrity, people who support the rules and customs of their group, are the foundation of a viable community.Psychoanalysis argues that the fundamentals of character are set by about age five. And, as Freud noted, character is fate. Specifically, by about age five, a child’s core self-esteem—guilt and self-doubt versus self-confidence and optimism—is largely settled. In addition, by about age five, a child’s orientation toward rules and authority—rebellion and defiance versus effortless compliance—is largely set. Measures of self-esteem and attitudes toward authority powerfully predict job performance in adulthood. More importantly for a discussion of character, low scores on these measures powerfully predict delinquent conduct in adulthood. Poor self-esteem and defiance of rules and authority also predict some white collar crime. However, white collar crime is better predicted by adding values—specifically measures of selfishness and greed.Finally, to put a practical end to this abstract discussion, researchers at Hogan have been studying crime and delinquency for over 30 years. They have accumulated solid data showing that the HPI and the HDS are robust predictors of both blue collar and white collar crime and delinquency. The MVPI can be used to evaluate selfishness and greed. Personality, character, and personality assessment come together to predict important life outcomes with an accuracy that rivals the best in medical diagnosis, an outcome that would have given Cronbach fits.

Understanding Testing: The case of the Rorschach

The talented and charismatic Swiss psychiatrist Hermann Rorschach published Psychodiagnostik in 1921. Rorschach’s inkblots soon attracted a cult-like following and became the most widely used projective test in the world. The theory behind projective tests is that, when people are asked to describe an ambiguous stimulus, their descriptions will reveal their private thoughts and fantasies—a theory that seems plausible on its face.In the summer of 2009, Wikipedia published Rorschach’s ten inkblots and the most common responses to them. In the July 30th, 2009 issue of Newsweek, Wray Herbert describes the firestorm that resulted. His article raises a number of issues that are worth additional comment; I will mention four. Click here to read the article.First, the article confuses personality measurement with the assessment of psychopathology. This is a common mistake because, from the beginning of personality measurement in the late 19th century until after World War II, every major measure of personality was also a measure of psychopathology; these measures included the Rorschach and the Minnesota Multiphasic Personality Inventory (MMPI)—the most widely used objective measure of personality in the world. Research on performance in combat during the war showed that the absence of psychopathology does not predict effective performance—many people with problematic MMPI profiles perform well under pressure and many people with normal profiles perform poorly. Realizing that psychopathology is not necessarily related to effectiveness, pioneers such as Harrison Gough (author of the California Psychological Inventory in 1954) developed measures of normal personality to predict competent and effective performance. The point is, it is possible to assess personality without assessing psychopathology; and it is necessary to do so if one wants to predict effectiveness.Second, along with many professional psychologists, the Newsweek article misrepresents the concept of test reliability. The reliability of any measure is a key issue in science. In the physical sciences, the reliability of a score is estimated by taking the same measure two or more times and comparing the scores. In contrast, many psychologists think that reliability should be estimated by how closely the items on a test cohere in a statistical fashion—but this has nothing to do with the reliability as defined in the physical sciences. The Newsweek article defines reliability in terms of the degree to which two people who score the same responses on the same test, get the same results. Although this definition is mistaken—because it concerns the reliability of the scoring method not the test scores—it is still closer to the scientific meaning of reliability than the definition used in academic psychology.Third, there is nothing wrong, in principle, with the Rorschach. Like any test, it is a collection of (10) test stimuli, which by themselves mean nothing. The utility of any test depends on its scoring key. More specifically, the utility of a test depends on validity—the degree to which scores on the test predict real world outcomes. It is possible to develop scoring keys for the Rorschach that predict outcomes, but first it is necessary to understand what the purpose of assessment is. Assessment has a job to do, and that is to predict significant non-test behavior.Finally, unlike many psychologists, Wray Herbert (the Newsweek writer) understands the importance of validity. At the close of his essay he notes that “This dust-up over the Rorschach could be just the beginning of a major intellectual housecleaning in a field that has drifted from its scientific roots.” As this comment indicates, validity is the scientific raison d’etre for assessment, but it is something that many test publishers ignore. This fact is a public scandal and one that will ultimately come to haunt the entire test publishing enterprise.

Why Personality Matters

Why does personality matter? To answer this question, we need to resolve two prior issues:

What is personality?Who wants to know why personality matters?

The answer to the question, “What is personality?” is that there are two answers. There is what we call “personality from the inside” and there is what we call “personality from the outside”. Personality from the inside concerns your view of you, it concerns the person you think you are—it concerns your hopes, your dreams, your values, your goals, your aspirations, your fears, and the things you think you need to do to realize your goals and avoid your fears. We refer to personality from the inside as your identity.

Personality from the outside concerns our view of you, the person we think you are, and we refer to this as your reputation. It concerns the things we need to know in order to be able to deal with you effectively. So, there is the you that you know, personality from the inside, or your identity. Then there is the you that we know, personality from the outside, or your reputation.

These two forms of personality are different in very important ways. Consider the you that you know—your identity. Freud would say that it is hardly worth knowing—because you made it up. Everyone has to be someone, and you are the hero or heroine in your own life’s drama, but that doesn’t mean that your identity is necessarily closely related to reality. The way people think about and describe themselves is only modestly related to how others describe them—people don’t really know themselves all that well. Even worse, about 100 years of research on identity shows that it is very hard—almost impossible—to study in a rigorous and empirical way. As a result, we psychologists don’t know very much about identity that is interesting or useful.

Consider the you that we know—your reputation. Reputation is quite interesting for several reasons. First, the best predictor of future behavior is past behavior; your reputation reflects your past behavior, therefore your reputation is the best information we have regarding what you are likely to do in the future. Second, reputations are easy to study—we need only ask other people to describe you. And third, there is a well-defined and widely accepted taxonomy of reputations that has been used to study occupational performance, and as a result, we psychologists know a lot about the kinds of people who do well or poorly in different kinds of jobs. That is, we know a lot about the links between reputation and occupational performance.

As for the question of who wants to know why personality matters, it matters to two categories of people: (a) people who are interested in their own career development; and (b) potential employers. People who are interested in their own career development need to know about their own strengths and shortcomings relative to the demands of various occupations. More precisely, people who want to approach the topic of career development in a strategic manner will want to know: (1) How their strengths match the demands of various careers; and(2) how other people will perceive them during job interviews and while working.

Personality matters to potential employers in at least three ways. First, they need to know what kind of employee you will be—will you be cranky, difficult, and hard to manage or will you be a world-class organizational citizen? Second, they need to know if your personality fits the demands of the job for which you are applying—do you have the drive to succeed in sales, the social skills to succeed in customer service, the good judgment to succeed as a manager? And third, they need to know if your values (your identity) are consistent with the corporate culture—it doesn’t matter how talented you are, if your values are inconsistent with the corporate culture, you will not succeed in that organization.

The bottom line is that personality matters to individuals because self-understanding allows a person to be strategic about his/her career choices and career development. Personality matters to employers because knowledge about a job applicant’s personality allows them to be strategic about the hiring process.

Want to learn more about personality tests? Check out The Ultimate Guide to Personality Tests

On Human Nature

Every significant piece of public policy, every important generalization in history, economics, political science, and sociology depends on (largely unevaluated) assumptions about human nature. Personality psychology concerns the nature of human nature; it is, therefore, concerned with one of the most powerful and dangerous forces on earth. Developing adequate methods for conceptualizing human nature and forecasting significant components of social behavior—for example, integrity, creativity, leadership—would seem to be a matter of real urgency. Nonetheless, personality psychology has a minor and marginal status in academic psychology. I have spent my career trying to understand the origins of human behavior, trying to develop measurement models for capturing key elements of social performance, and trying to defend the study of personality against the complaints of a seemingly endless supply of academic critics.

Robert McNamara’s Leadership

Robert S. McNamara (1916-2009) was the most powerful American Secretary of Defense in history and in many ways the architect of the modern war on terror. He was an immensely talented and successful man, whose career went up like a rocket from the beginning. Born in San Francisco, he was an Eagle Scout and President of the Rigma Lions boys club in 1933. He attended the University of California, Berkeley, where he studied economics, mathematics, and philosophy, was elected to Phi Beta Kappa in his sophomore year, and earned a varsity letter in crew. After receiving a master’s degree from the Harvard Graduate School of Business Administration in 1939, he worked for Price Waterhouse for a year. He then joined the Harvard faculty as the youngest and highest paid Assistant Professor at the university. He joined the Army Air Force in 1943 and worked in the Office of Statistical Control, where he analyzed the accuracy and effectiveness of US bombing missions, and made powerful connections.In 1946, McNamara and 9 other former officers joined Ford Motor Company with a mandate to stop its financial and administrative chaos using modern planning and management control systems. He again advanced rapidly, and in November, 1960 became the first president of the company who was not a member of the Ford family. A few weeks later, President-elect John F. Kennedy recruited him to be Secretary of Defense. Kennedy described McNamara as the smartest man he had ever met.Kennedy first directed McNamara to plan the Bay of Pigs invasion, which was a disaster, and then asked him to develop even more elaborate plans to overthrow Castro. In 1962, McNamara began implementing the modern strategy of counterinsurgency warfare to combat terrorism; he created special forces like the Green Berets, and sponsored secret paramilitary operations throughout Asia and Latin America. In 1963, again in response to the President’s request, he began a troop build-up in South Vietnam. After Kennedy’s assassination in November, 1963, President Lyndon Johnson asked him to stay on as Defense Secretary, and in essence turned the conduct of foreign policy over to him. Johnson, in awe of McNamara, commented “He is like a jackhammer….He drives too hard. He is too perfect.” In 1964, Johnson asked him to be his Vice-Presidential running mate, but McNamara declined.McNamara prosecuted the Vietnam War with his usual diligence, but had doubts about it being winnable. In 1967, he sent President Johnson a long memo urging him to begin negotiating with the North Vietnamese rather than escalating the war. Johnson decided that McNamara was plotting against him on behalf of the Kennedys, fired him as Secretary of Defense, and anointed him as President of the World Bank where he served from April, 1968 to June, 1981, when he retired.The Vietnam War is widely regarded as the greatest foreign policy mistake in U.S. history. Over 54,000 American troops died, millions of Vietnamese were killed, and nothing was resolved. In 1995, McNamara published a memoir in which he said his conduct of the war was “wrong, terribly wrong”. In reply, Howell Raines, the editor of the New York Times, wrote an editorial in which he noted: “Surely he must in every quiet and prosperous moment hear the ceaseless whispers of those poor boys in the infantry, dying in the tall grass, platoon by platoon, for no purpose. What he took from them cannot be repaid by prime-time apology and stale tears, three decades late.”AnalysisAt each point in his career—as a student, academic, business executive, Cabinet Secretary, and public figure—Robert McNamara was fabulously successful. He substantially rebuilt Ford Motor Company, as Defense Secretary, he was instrumental in putting in place wide ranging reforms to streamline the Pentagon and make it more effective, and he transformed the World Bank from an old boy’s club to an instrument for third world economic development. And then there is the Vietnamese war—an unmitigated disaster. How are we to understand this?The answer concerns how we think about leadership. The academic literature defines leadership in terms of the ability to ascend to the top of a hierarchy, and McNamara was superbly equipped to do this. He was very smart, very hard working, great with numbers and details, clear-minded, logical, and very, very eager to please his superiors. This is the recipe for success in a bureaucracy.In contrast with the academic literature, I think the essence of leadership concerns being able to build a team, being able to unite a group and act toward a common goal. McNamara was ruthlessly dismissive of subordinates who challenged him (he had no peers). His talent was for fixing inefficiencies and implementing processes. He had no talent for anticipating or even considering the human costs of his processes. His concern about the Vietnam war was that it was unwinnable from a technical perspective, not that lives were being wasted. He was an immensely successful bureaucrat but not a gifted leader.There is a sense in which Robert McNamara was a train wreck waiting to happen. He was an exquisitely tooled bureaucratic instrument, who could and would deliver results for whoever happened to be his boss. As Secretary of Defense, his first boss was the callow and impulsive John Kennedy, who ordered him to begin what ultimately became our war on terror—covert and illegal operations in Latin America and Southeast Asia. He second boss was Lyndon Johnson, a skilled and ruthless legislator who knew nothing about international relations, and whose staff feared he was insane. Kennedy foolishly invaded South Vietnam, Johnson inherited the project, and vowed not to be the first American President “to cut and run.” McNamara’s ambition and eagerness to please authority prevented him from opposing these policies and the rest is history. As for moral culpability, he was just following orders.